For any company directors or employees, a company pension is one of the most tax efficient ways of transferring profits from the company. Contributions by a company to a pension plan do not suffer any tax penalties and can be written off by the company against corporation tax. The employer must contribute at least one tenth of the total contributions made to the scheme. There are two types of company pension scheme:

1.  Defined benefit: Where the retirement benefits are based on the final salary at retirement as defined under the rules of the scheme and the number of years worked with the company.

2.  Defined contribution: Where the benefits are directly related to how much the employer, and perhaps the employee have contributed to the scheme. The total contribution plus the investment growth determine the total value of the retirement fund.



Retirement can take place between the ages of 60 and 70. On retirement you have several options:

1. 1.5 times final salary is value tax free
2. Encash the balance subject to a deduction of income tax
3. Invest the rest of the fund in an annuity and receive a salary for the rest of your life
4. Invest in an approved retirement fund

What is an executive pension plan?
A pension designed for company directors and owners.

Executive pension plan benefits

• tax free pension plan contributions
• your employer can also contribute to your pension plan
• take a tax-free lump sum depending on length of service, salary and fund size